The government accepts wage rate recommendations

This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

The Low Pay Commission welcomes the government’s acceptance of its recommendations on wage rates from October 2014

The Low Pay Commission today welcomed the government’s acceptance of its recommendations on rates for the National Minimum Wage (NMW) for adults and young people from October 2014.

The Chair of the Low Pay Commission, David Norgrove said:

“We have again examined all the evidence very carefully. We believe that the economic recovery should allow an increase in the real value of the minimum wage. Our recommendation that the adult minimum wage should increase by 3 per cent to £6.50 an hour is likely to increase its real value for the first time for at least five years.

At the same time it takes account of the pressure the minimum wage places on businesses, particularly in the low-paying sectors and small firms.

Provided the economy continues to improve we expect to recommend further progressive real increases in the minimum wage, so that 2014 will mark the start of a new phase – of bigger increases than in recent years – in the work of the Low Pay Commission.

The labour market position of young people has yet to improve to match that of adults, although it now appears to have stabilised. We have recommended increases of 2 per cent in their rates which should broadly protect their real value while increasing the relative attractiveness of young people to employers. We believe that youth rates should rise by more than adult rates when economic circumstances permit.”